Today’s low home loan interest rates are encouraging many young families to get off the renting bandwagon and apply for their first home loan. But with the many expenses that come along with raising children, saving for home loans isn’t always easy. Choice Home Loans has compiled a list of simple tips that we hope will make introducing a savings plan, that much easier.
Reduce your bills
Are you paying more for your household costs than you need to? Think about ways you could reduce the amount you’re spending, like moving to a cheaper internet plan, encouraging the kids to use less water when showering, and turning off all outlets at night and before you leave the house.
Make an effort to eat in
It may seem like an easier option to get take-away for dinner after an exhausting day at the office, but purchasing food in bulk and ensuring both you and the kids are bringing your own lunches every day rather than buying is an easy way to cut down your food expenses.
Increase your income
You may not have time to get another job on the side to boost your earnings, but you can get creative with your fundraising. If you own any clothing or furniture you’re not using, sell it on eBay, or sign up to a local market research company to test products.
Make your money work for you
Make sure the account you are putting your deposit savings in is earning a high rate of interest, so your money accumulates faster. Many banks have accounts designed specifically for home buyers, with extra interest incentives if you contribute regularly. The interest you earn may need to be declared as income for tax purposes, so it is important to seek independent legal and financial advice.You may also want to consider any applicable account keeping fees and charges, which you can check with the institution directly.
Pay down your credit card
Paying down credit card debts and ensuring payments are made on time, is another key way to minimise your costs and maximise your savings for your first home loan. Not only will you reduce the amount of interest you’re paying, you’ll also improve your credit rating and your chance of getting your home loan application approved.
Boost your savings
As well as putting a portion of your regular wages aside, it’s important to also use one-off cash payments to boost your deposit savings. If you get a substantial windfall from a work bonus or tax refund, put it into your savings account before you’re tempted to splash out with it.
If you really want to buy your first home but are struggling to figure out how, Choice Home Loans can help. Our brokers will take you through your financial options and give you all the advice you need, tailored to the needs of you and your family.
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